Workers compensation system for determining a cost of insurance based on real-time payroll data

ABSTRACT

A system/method implemented at an insurance company estimates a final premium charge and more accurate real time estimate during the lifetime of the policy for workers compensation insurance associated with a risk based on: receiving real-time payroll data associated with the risk; monitoring the received real-time payroll data to identify and record raw data elements that have an identified relationship with any of, or a combination of, the following: the risk&#39;s business operation, insurability of the risk, character of the risk, or rating parameters associated with the risk&#39;s policy; and determining the final premium charge of workers compensation insurance for the risk based on a premium modification that increases or decreases a premium charge based on an evaluation of the recorded raw data elements.

RELATED APPLICATION

This application is a divisional of pending U.S. application Ser. No.11/381,676 filed May 4, 2006. Additionally, this application claimspriority benefit to U.S. provisional application 60/577,410 filed May 4,2005, which is incorporated herein by reference in its entirety.

BACKGROUND OF THE INVENTION

1. Field of Invention

The present invention relates generally to the field of insurance. Morespecifically, the present invention is related to insurance costcalculations based on real-time payroll data.

2. Discussion of Prior Art

Conventional methods for determining costs of workers compensationinsurance involve gathering relevant historical data from a personalinterview with the applicant for the insurance and by referencing theapplicant's prior insurance records that are maintained by agovernmental agency, such as a Bureau of Workers Compensation Insurance,if such records exist. Such data results in a classification of theapplicant to a broad actuarial class for which insurance rates areassigned based upon the empirical experience of the insurer. Manyfactors are relevant to such classification in a particular actuarialclass, such as type of employee, hours worked, location of work,exposure classification, etc, and the cost is based upon projectedpayroll and type of occupations expected within the insured's businessover the next year.

The current system of insurance creates groupings of risks (actuarialclasses) based on the following types of classifications:

-   -   Number of Employees    -   Payroll    -   Actuarial Classification Codes    -   State of coverage    -   Experience Mod    -   Included Officers Coverage    -   Types of previous losses    -   Liability limits    -   State deductibles    -   Credits

The classifications, such as payroll, are further broken into actuarialclasses, to develop a unique risk insurance cost based on the specificcombination of actuarial classes for a particular risk. The exampleshown in FIG. 1 would produce a unique insurance cost.

A change to any of this information would result in a different premiumbeing charged, if the change resulted in a different actuarial class forthat variable. For instance, a change in the risk's payroll from 58thousand to 57 thousand may or may not result in a different actuarialclass, however, a change in an employee's classification from 0815 to0953 may result in a different premium because of the change inactuarial class.

A principal problem with such conventional insurance determinationsystems is that much of the data gathered from the applicant in theinterview is not verifiable or is used as a snapshot of the insured'sexposures only at that moment in time, and even existing public recordscontain only minimal information, much of which has little relevancetowards an assessment of the likelihood of a claim subsequentlyoccurring and obtaining premium based upon actual exposures versus aretrospective analysis at policy termination. In other words, currentrating systems are primarily based on past realized losses, projectedconditions of the risk's payroll, classes, size and employee population,which are projected over the life of the policy, usually one year. Thisdata is usually not updated until the end of the policy term, wherein aninsurance company exercises its right to audit the business to determinemore accurately the number of employees, their actual payroll, and otherfactors. None of the information obtained through conventional systemsnecessarily reliably predicts the manner or safety of future employeractivities. Accordingly, the limited amount of accumulated timesensitive, relevant data, and its minimal evidential value towardscomputation of a fair cost of insurance has generated a long-felt needfor an improved system for more reliably and accurately accumulatingdata having a highly relevant evidential value towards predicting theactual payroll and classification changes of the risk. In addition, thechanges in premium that result from these predictions is charged orcredited directly to the risk to better facilitate cash flow managementtechniques.

Many types of workers compensation data collection systems haveheretofore been suggested for purposes of maintaining an accurate recordof certain elements of a risk's operation. Some are suggested foridentifying the cause of a loss, others are for more accuratelyassessing the efficiency of classifying the employee's of the risk. Suchsystems disclose a variety of conventional techniques for collecting therisk's operational data elements in a variety of data collectionsystems.

The various forms and types of risk company information acquisitionsystems that have heretofore been suggested and employed have met withvarying degrees of success for their express limited purposes. Allpossess substantial defects, such that they have only limited economicaland practical value for a system intended to provide an enhancedacquisition, recording and uploading of system of data which would beboth comprehensive and reliable in predicting an accurate and adequatecost of insurance for the risk. Since the type of company operatinginformation acquired and recorded in prior art systems was generallynever intended to be used for determining an updated cost of workerscompensation insurance, the data elements that were monitored andrecorded therein were not directly related to predetermined safetystandards or the determining of an actuarial class for the employees.There is also the problem of collecting and subsequently compiling therelevant data for an accurate determination of an actuarial profile andan appropriate insurance cost therefore.

Current payroll control and operating systems comprise electronic datareporting systems readily adaptable for modification to obtain thedesired types of information relevant to determination of the cost ofinsurance. Payroll tracking systems have been suggested which useuploads to back-end audit systems for providing information describing arisk's changes to the original insurance application. When suchinformation is combined with additional information in an expert system,a risk's premium is ascertainable. Mere back-end audit information,though, will not provide data particularly relevant to the actuarialclass of operation unless the data is combined with other relevant datain an expert system which is capable of assessing whether the change isrelevant to the policy's terms or not, and, in addition, it is notreal-time, which does not afford the carrier the opportunity to preventpotential losses, such as applying Loss Control services.

Typically, workers compensation premiums are derived from informationobtained directly from the risk at the inception of the policy's term,and then, again through a payroll audit conducted at the end of apolicy's term. This causes, in some cases, a materially significantdifference in premium costs, if the conditions of the policy's exposure,changes considerably from policy inception to audit. There is a need inthe industry to “flatten” out this change in premium by monitoring arisk's payroll and manage the risk (which is accomplished through apayroll-processing monitoring system) electronically, and then,adjusting the policy's premium reflective of the actual, current riskand spreading the difference in cost over the life of the policy to moreaccurately reflect the real exposure of the risk.

Whatever the precise merits, features, and advantages of the abovementioned prior art techniques, none of them achieves or fulfills thepurposes of the present invention.

SUMMARY OF THE INVENTION

The present invention provides for a computer-based method implementedat an insurance company to estimate a final premium charge and moreaccurate real time estimate during the lifetime of the policy forworkers compensation insurance associated with a risk, wherein themethod comprises: the insurance company receiving real-time payroll dataassociated with the risk; the insurance company monitoring the receivedreal-time payroll data to identify and record raw data elements thathave an identified relationship with any of, or a combination of, thefollowing: the risk's business operation, insurability of the risk,character of the risk, or rating parameters associated with the risk'spolicy; and the insurance company determining the final premium chargeof workers compensation insurance for the risk based on a premiummodification that increases or decreases a premium charge based on anevaluation of the recorded raw data elements.

The present invention also teaches a method of generating an actuarialclass system for determining workers compensation insurance costs foradjusting premiums for an insurance period of time based on data derivedfrom the risk's business operational characteristics and the employee'srating classification during the insurance period of time, comprising:receiving real-time record files representing payroll data associatedwith a risk during a time period; analyzing the risk's record files withselected actuarial classes; and determining a corresponding cost ofinsurance for the risk in correspondence with one of the actuarialclasses for the insurance period of time.

The present invention also provides for an article of manufacture havingcomputer readable storage medium having instructions executable by aprocessor to implement computer-based method implemented at an insurancecompany to estimate a final premium charge and more accurate real timeestimate during the lifetime of the policy for workers compensationinsurance associated with a risk, the computer readable storage mediumcomprising: computer readable program code receiving real-time payrolldata associated with the risk; computer readable program code monitoringthe received real-time payroll data to identify and record raw dataelements that have an identified relationship with any of, or acombination of, the following: the risk's business operation,insurability of the risk, character of the risk, or rating parametersassociated with the risk's policy; and computer readable program codedetermining the final premium charge and more accurate real timeestimate during the lifetime of the policy of workers compensationinsurance for the risk based on a premium modification that increases ordecreases a premium charge based on an evaluation of the recorded rawdata elements.

The present invention also provides for an article of manufacture havingcomputer readable storage medium having instructions executable by aprocessor to implement a method of generating an actuarial class systemfor determining workers compensation insurance costs for adjustingpremiums for an insurance period of time based on data derived from therisk's business operational characteristics and the employee's ratingclassification during the insurance period of time, the computerreadable program code comprising: computer readable program codereceiving real-time record files representing payroll data associatedwith a risk during a time period; computer readable program codeanalyzing the risk's record files with selected actuarial classes; andcomputer readable program code determining a corresponding cost ofinsurance for the risk in correspondence with one of the actuarialclasses for the insurance period of time.

BRIEF DESCRIPTION OF THE DRAWINGS

FIG. 1 illustrates a prior art system including classifications, such aspayroll, broken into actuarial classes, used to develop a unique riskinsurance cost based on the specific combination of actuarial classesfor a particular risk.

FIG. 2 illustrates the basic topology for implementing the presentinvention.

FIGS. 3 a-d illustrate exemplary scenarios where the present invention'ssystem and method are implemented at the insurance carrier.

FIG. 4 illustrates a basic flow chart of the processing sequence of thepresent invention including an exception processing element.

DESCRIPTION OF THE PREFERRED EMBODIMENTS

While this invention is illustrated and described in a preferredembodiment, the invention may be produced in many differentconfigurations. There is depicted in the drawings, and will herein bedescribed in detail, a preferred embodiment of the invention, with theunderstanding that the present disclosure is to be considered as anexemplification of the principles of the invention and the associatedfunctional specifications for its construction and is not intended tolimit the invention to the embodiment illustrated. Those skilled in theart will envision many other possible variations within the scope of thepresent invention.

The present invention contemplates a new and improved workerscompensation monitoring, collecting, and communication system, whichprimarily overcomes the problem of determining a cost of insurance basedupon data which does not take into consideration how a specific payrollchanged during the life cycle of the policy. The subject invention willbase insurance charges with regard to current material datarepresentative of actual current payroll characteristics of the risk toprovide a classification rating of each employee into an actuarial classwhich has a vastly reduced rating error over conventional insurance costsystems. Additionally, the present invention allows for ongoingadjustments to the cost of coverage because of the changes in the risk'snumber of employees and/or their payroll to said employees. This canresult in workers compensation insurance charges that are readilycontrollable by the risk. The system is adaptable to current electronicpayroll reporting systems, tracking systems and data upload systems forthe improved extraction of selected insurance related data.

FIG. 2 illustrates the basic topology for implementing the presentinvention wherein the present invention's system and method (asimplemented in the insurance carrier) communicates directly with theemployer (which in turn works in conjunction with the depicted payrollprocessor and insurance agency) to receive real-time payroll dataassociated with the risk. The insurance carrier monitors the receivedreal-time payroll data to identify and record raw data elements thathave an identified relationship with any of, or a combination of, thefollowing: said risk's business operation, insurability of said risk,character of said risk, or rating parameters associated with said risk'spolicy. The insurance company determines the final premium charge andmore accurate real time estimate during the lifetime of the policy ofworkers compensation insurance for the risk based on a premiummodification that increases or decreases a premium charge based on anevaluation of said recorded raw data elements.

Although an example is shown in FIG. 2 illustrating the specificinteraction between the employer, insurance carrier, payroll processor,and insurance agency, other variations are within the scope of thepresent invention. For example, FIGS. 3 a-d illustrate exemplaryscenarios where the present invention's system and method areimplemented at the insurance carrier. FIG. 3 a illustrates the specificscenario involving a large self-insured entity working in conjunctionwith the insurance carrier implementing the present invention. FIG. 3 billustrates another scenario wherein the employer works with a specificinsurance agency and a specific payroll processor. FIG. 3 c illustratesanother scenario wherein the employer works in conjunction with only apayroll processor (and no insurance agency). FIG. 3 d illustrates yetanother scenario where the employer works with a payroll processor thathas a preferred insurance agency. In the scenarios of FIG. 2 and FIGS. 3a-d, the insurance company works directly with the employer to determinethe final premium charge and more accurate real time estimate during thelifetime of the policy of workers compensation insurance for theemployer based on a premium modification that increases or decreases apremium charge based on an evaluation of recorded raw data elements.

FIG. 4 illustrates a basic flow chart of one embodiment of theprocessing sequence. In accordance therewith, there is disclosed amethod of determining a cost of workers compensation insurance basedupon monitoring, collecting and communicating data representative of therisk's characteristics, whereby the cost is adjustable by relating thepayroll characteristics to predetermined actuarial rates. The method iscomprised of steps of monitoring a plurality of raw data elementsrepresentative of an operating state of the risk's business. Selectedones of the plurality of raw data elements are recorded when they aredetermined to have an identified relationship to the rating parametersof the risk's policy. The recorded elements are consolidated forprocessing against an insured profile and for identifying a surcharge ordiscount to be applied to a base cost of workers compensation insurance.The total cost of insurance obtained from combining the base cost andsurcharges or discounts is produced as a final cost to the risk, and isdirectly charged, or credited, directly to the risk via their financeplan.

The present invention provides for a computer-based method implementedat an insurance company to estimate a final premium charge for workerscompensation insurance associated with a risk, wherein the methodcomprises: the insurance company receiving real-time payroll dataassociated with the risk; the insurance company monitoring the receivedreal-time payroll data to identify and record raw data elements thathave an identified relationship with any of, or a combination of, thefollowing: the risk's business operation, insurability of the risk,character of the risk, or rating parameters associated with the risk'spolicy; and the insurance company determining the final premium chargeof workers compensation insurance for said risk based on a premiummodification that increases or decreases a premium charge based on anevaluation of said recorded raw data elements.

The present invention provides for a computer-based method to determinea final premium charge and more accurate real time estimate during thelifetime of the policy for workers compensation insurance associatedwith a risk, wherein the computer-based method comprises the steps of:monitoring a set of raw data elements, the raw data elements associatedwith any of, or a combination of, the following: the risk's employmentpractice, the risk's payroll, modification to the risk's payroll, oroperating state of the risk; identifying and recording a subset of theraw data elements that have an identified relationship with any of, or acombination of, the following: the risk's business operation,insurability of the risk, character of the risk, or rating parametersassociated with the risk's policy; and determining the final premiumcharge of workers compensation insurance of the risk based on a premiummodification that increases or decreases a premium charge based on anevaluation of the recorded subset of raw data elements.

The present invention also provides for a business method implementedover a network to estimate a final premium charge and more accurate realtime estimate during the lifetime of the policy for workers compensationinsurance associated with a risk, wherein the business method comprisingthe steps of: monitoring a set of raw data elements, the raw dataelements associated with any of, or a combination of, the following: therisk's employment practice, the risk's payroll, modification to therisk's payroll, or operating state of the risk; identifying andrecording a subset of the raw data elements that have an identifiedrelationship with any of, or a combination of, the following: the risk'sbusiness operation, insurability of the risk, or rating parametersassociated with the risk's policy; determining the final premium chargeof workers compensation insurance of the risk based on a premiummodification that increases or decreases a premium charge based on anevaluation of the recorded subset of raw data elements; and generatingrevenue by performing a financial transaction over the network based onthe determined final premium charge.

The present invention also provides for a method of determining a costof workers compensation insurance for a selected period based uponmonitoring, collecting and communicating data representative of therisk's payroll characteristics during said selected period, whereby thecost is adjustable by relating the payroll characteristics topredetermined actuarial rates and the method comprises the steps of:determining an initial profile and a base cost of workers compensationinsurance based on the profile; monitoring a plurality of data elementsrepresentative of payroll and business status of a risk during saidselected period; identifying and analyzing data elements among theplurality of data elements that have a pre-identified relationship tothe risk's insurability; consolidating the analyzed data elements foridentifying a surcharge or discount to be applied to the base cost; andproducing a final cost of workers compensation insurance for theselected period from the base cost and the surcharges or discounts to bebilled directly to the risk based on their finance plan, whereby therisk is charged or credited said final cost for workers compensationinsurance.

In accordance with another aspect of the present invention, thecollection process comprises identifying a trigger event associated withthe raw data elements which has an identified relationship to the risk'spolicy conditions so that trigger information representative of theevent is recorded.

In accordance with yet another aspect of the present invention, themethod comprises steps of generating calculated data elements andderived data elements from the raw data elements, and accumulating thecalculated and derived data elements in a proprietary database.

The present invention will use information acquired from the risk tomore accurately assess the risk's business and thereby derive insurancecosts more precisely and fairly. Examples of possible actuarial classesdeveloped from risk provided data include:

-   -   Payroll    -   Number of employees    -   Job Classification    -   Payroll per employee

These new and more precise actuarial classes are considered to be betterpredictors of premium cost because they are based on actual payrollsdispersed by the risk. This will allow the risk more precise controlover their cash flow because the cost of their insurance will match moreprecisely the actual real-time experience of the business.

One benefit obtained by use of the present invention is a system thatwill provide precise and timely information about the current operationof a risk's business that will enable an accurate determination ofoperating characteristics, including such features as number ofemployees, job duties and classifications, and amount of payroll. Thisinformation can be used to establish actual real-time, fact based,insurance charges, eliminating rating errors that are prevalent intraditional systems and will result in insurance charges that can bedirectly controlled by the risk. Charges and/or credits can then beimmediately reflected directly to the risk via their finance plan. Also,the insured business and the carrier can benefit from applying LossControl services as the exposures occur, to prevent injuries which thenimpact on the profitability of the account and future premium chargesfor the business.

It is another benefit of the subject invention that conventional payrollprocessing company's database interfaces are easily supplemented andinterfaced by our database system components to extract selectedinsurance relevant data from the risk.

It is yet another object of the present invention to generate actuarialclasses and risk profiles relative thereto based upon actual businesscharacteristics of the risk, as represented by the monitored andrecorded data elements for providing a more knowledgeable, enhancedinsurance rating precision.

The subject new insurance rating system retrospectively adjusts andprospectively sets premiums based on data derived from risk suppliedcharacteristics throughout the policy period through the generation ofnew actuarial classes determined from such characteristics, whichclasses heretofore have been unknown in the insurance industry.

Other benefits and advantages of the subject new insurance costdetermination process will become apparent to those skilled in the artupon a reading and understanding of the specification.

One of the useful consequences of the subject invention is that otherproducts could be marketed to a particular risk based on informationprovided from the subject invention from the risk's business. Since theinvention includes processes for gathering, extracting and analyzinginformation provided by the risk, a more informed judgment can be madeabout a determination of when and which products could be marketed tothat risk.

The present invention process benefits the insurance company becausechanges to characteristics of the risk can be immediately reflected inthe policy's premium and charged directly to the risk according to theterms of the policy's finance plan. This not only allows the risk tohave better cash flow management opportunities, but, also, the insurancecompany experiences the benefit of immediately realizing their exposure.The charge that is generated directly to the risk is also a cash flowmanagement tool that is better than traditional “charge back” methodsbecause the insurance company enjoys the immediate availability offunds, as opposed to waiting for the audit results, or, as opposed towaiting for the charge-back through a payroll-processor, and takesresponsibilities for the calculation of premium and fees.

The invention has been described with reference to preferredembodiments. Obviously, modifications and alterations will occur toothers upon a reading and understanding of the specification. It is ourintention to include all such modifications and alterations insofar asthey come within the scope of the appended claims or the equivalentsthereof.

Additionally, the present invention provides for an article ofmanufacture comprising computer readable program code contained withinimplementing one or more modules to determine cost of workerscompensation insurance based upon monitoring, collecting andcommunicating data representative of the risk's “real time” number ofemployees, classification of employees, payroll, and othercharacteristics by acquiring this data through the risk's “payrollprocessor”.

The present invention also provides for a system to determine a finalpremium charge and more accurate real time estimate during the lifetimeof the policy of workers compensation insurance associated with a risk,wherein the system as implemented at an insurance company comprises: afirst engine monitoring a set of raw data elements, the raw dataelements associated with any of, or a combination of, the following: therisk's employment practice, the risk's payroll, modification to therisk's payroll, or operating state of the risk; a second engineidentifying and recording a subset of the raw data elements that have anidentified relationship with any of, or a combination of, the following:the risk's business operation, insurability of the risk, or ratingparameters associated with the risk's policy, and a workers compensationinsurance estimator working in conjunction with the first and secondengine to determine the final premium charge of workers compensationinsurance of the risk based on a premium modification that increases ordecreases a premium charge based on an evaluation of the recorded subsetof raw data elements.

Furthermore, the present invention includes a computer programcode-based product, which is a storage medium having program code storedtherein which can be used to instruct a computer to perform any of themethods associated with the present invention. The computer storagemedium includes any of, but is not limited to, the following: CD-ROM,DVD, magnetic tape, optical disc, hard drive, floppy disk, ferroelectricmemory, flash memory, ferromagnetic memory, optical storage, chargecoupled devices, magnetic or optical cards, smart cards, EEPROM, EPROM,RAM, ROM, DRAM, SRAM, SDRAM, or any other appropriate static or dynamicmemory or data storage devices.

The present invention also provides for an article of manufacturecomprising a computer usable medium having computer readable programcode embodied therein which implements a method to estimate a finalpremium charge and more accurate real time estimate during the lifetimeof the policy for workers compensation insurance associated with a risk,wherein the medium comprises: computer readable program code monitoringa set of raw data elements, the raw data elements associated with anyof, or a combination of, the following: the risk's employment practice,the risk's payroll, modification to the risk's payroll, or operatingstate of the risk; computer readable program code identifying andrecording a subset of the raw data elements that have an identifiedrelationship with any of, or a combination of, the following: the risk'sbusiness operation, insurability of the risk, character of the risk, orrating parameters associated with the risk's policy; and computerreadable program code determining the final premium charge of workerscompensation insurance of the risk based on a premium modification thatincreases or decreases a premium charge based on an evaluation of saidrecorded subset of raw data elements.

CONCLUSION

A system and method has been shown in the above embodiments for theeffective implementation of workers compensation system for determininga cost of insurance based on real-time payroll data. While variouspreferred embodiments have been shown and described, it will beunderstood that there is no intent to limit the invention by suchdisclosure, but rather, it is intended to cover all modificationsfalling within the spirit and scope of the invention, as defined in theappended claims. For example, the present invention should not belimited to the preferred embodiment workman's compensation calculation;other insurance types and programs can benefit from the presentinvention without departing from the scope thereof. Also,software/program, computing environment, or specific computing hardware,should not limit the invention.

The above enhancements are implemented in various computingenvironments. For example, the present invention may be implemented on aconventional PC or equivalent, multi-nodal system (e.g. LAN) ornetworking system (e.g. Internet, WWW, wireless web). All programmingand data related thereto are stored in computer memory, static ordynamic, and may be retrieved by the user in any of: conventionalcomputer storage, display (i.e. CRT) and/or hardcopy (i.e. printed)formats. The programming of the present invention may be implemented byone of skill in the art of database programming.

The invention claimed is:
 1. A computer-based method implemented at aninsurance company to estimate a final premium charge and more accuratereal time estimate during the lifetime of the policy for workerscompensation insurance associated with a risk, said method implementedby executing, by a processor, computer readable program code stored instorage, said method comprising: said processor executing computerreadable program code at said insurance company and interfacing inreal-time with the risk's payroll processor; said processor executingcomputer readable program code at said insurance company and receivingreal-time payroll data associated with said risk from said risk'spayroll processor; said processor executing computer readable programcode at said insurance company and monitoring said received real-timepayroll data to identify and record raw data elements that have anidentified relationship with any of, or a combination of, the following:said risk's business operation, insurability of said risk, character ofsaid risk, or rating parameters associated with said risk's policy; saidprocessor executing computer readable program code at said insurancecompany and developing at least the following actuarial classes fromsaid monitored real-time payroll data: payroll, number of employees, jobclassification, and payroll per employee; said processor executingcomputer readable program code at said insurance company and determiningsaid final premium charge and more accurate real time estimate duringthe lifetime of the policy of workers compensation insurance for saidrisk based on a premium modification that increases or decreases apremium charge based on an evaluation of said actuarial classesdeveloped in real-time by monitoring payroll data received in real-timefrom said risk's payroll processor; and said processor executingcomputer readable program code at said insurance company outputting saiddetermined final premium charge.
 2. A computer-based method implementedat an insurance company to estimate a final premium charge for workerscompensation insurance associated with a risk, as per claim 1, whereinsaid computer-based method is performed over a network.
 3. Acomputer-based method implemented at an insurance company to estimate afinal premium charge for workers compensation insurance associated witha risk, as per claim 2, wherein said network is any of the following:local area network (LAN), wide area network (WAN), or the Internet. 4.An article of manufacture having computer readable storage medium havinginstructions executable by a processor to implement computer-basedmethod implemented at an insurance company to estimate a final premiumcharge and more accurate real time estimate during the lifetime of thepolicy for workers compensation insurance associated with a risk, saidcomputer readable storage medium comprising: computer readable programcode interfacing in real-time with the risk's payroll processor;computer readable program code receiving real-time payroll dataassociated with said risk from said risk's payroll processor; computerreadable program code monitoring said received real-time payroll data toidentify and record raw data elements that have an identifiedrelationship with any of, or a combination of, the following: saidrisk's business operation, insurability of said risk, character of saidrisk, or rating parameters associated with said risk's policy; saidinsurance company developing at least the following actuarial classesfrom said monitored real-time payroll data: payroll, number ofemployees, job classification, and payroll per employee; computerreadable program code determining said final premium charge and moreaccurate real time estimate during the lifetime of the policy of workerscompensation insurance for said risk based on a premium modificationthat increases or decreases a premium charge based on an evaluation ofsaid actuarial classes developed in real-time by monitoring payroll datareceived in real-time from said risk's payroll processor; and computerreadable program code outputting said determined final premium charge.